3/10/2005 @ 6:00PM

Homes Of The Billionaires 2005

How does the other half live? Well, it depends. Try more like how does the other 0.00001% live?

According to the National Association of Home Builders (NAHB), the median American house size is slightly more than 2,000 square feet. Compare that with the domicile of the world’s richest man: As might be expected from one with that sobriquet,
Microsoft
founder
Bill
Gates
Bill Gates
‘ house is more than 30 times the average size. The NAHB says that most houses have three bedrooms, one fireplace and are sided with vinyl or aluminum. Some billionaires’ homes have more than a dozen bedrooms, and the only vinyl is in the rare-record collection housed in the custom-built listening room.

Yet as extravagant as some of their mansions may seem, the homes of the super-rich are not out of proportion to their wealth. In fact, comparatively, they can seem downright modest.

According to the National Association of Realtors, about one-fifth of a household’s wealth is composed of home equity. Let’s say that held true for
Warren
Buffett
Warren Buffett
: The mastermind behind holding company
Berkshire Hathaway
is second on our list of the World’s Richest People, with an estimated net worth of $44 billion. If he sank the average 20% into his home, the property would have to be worth…oh, approximately $8.8 billion–roughly the gross domestic product of Iceland.

Instead, Buffett lives more like a millionaire than a billionaire. For nearly 50 years, he’s bedded down in the same Omaha house he bought for $31,500. Although far from elaborate, it is still more than adequate. In 2003, the local assessor pegged its value at nearly $700,000. Buffett disagreed–he thought it was worth closer to $500,000.

Buffett’s not the only penny-wise homeowner on the list.
Ingvar
Kamprad
Ingvar Kamprad
, founder and former chief executive of home furnishings giant
IKEA
, is a notorious tightwad who drives a second-hand Volvo. His house in Lausanne, Switzerland, though hidden behind a high hedge, is said to be surprisingly unremarkable. He does indulge in winemaking at his small vineyard in Provence, but has been known to complain that it’s an expensive hobby.

Like Gates, though, most billionaires are willing to lavish millions creating their own private Xanadus.

Prince
Alwaleed bin Talal
Alsaud
Alwaleed bin Talal Alsaud
of Saudi Arabia has a 317-room palace in Riyadh, which reportedly cost $130 million to build. Totaling 400,000 square feet, it has a soccer field, eight elevators and more than 500 television sets. Then again, he has $23.7 billion in riches, including a longtime 3.9% stake in
Citigroup
.

Lakshmi Mittal, the Indian steel tycoon who is the world’s third-richest man, set a worldwide price record for a single-family home last year when he spent $128 million for his London townhouse. It’s not just near a palace, it’s outfitted like one. Even the swimming pool is said to be encrusted with gems.

And why not? Even if you don’t need the mortgage-interest deduction on your income taxes, there are practical reasons to own a mega-mansion. If you want to pack some political punch, for example, you’d best be prepared to host some high-profile fundraisers. Hollywooder
David
Geffen
David Geffen
, for example, boosted the campaign coffers of
Bill
Clinton
Bill Clinton
and
Al
Gore
Al Gore
with events at his Beverly Hills estate.

The GOP also has plenty of friendly fundraisers with big houses. In 2003, President George W. Bush visited cellular phone magnate
Craig
McCaw
Craig McCaw
–and collected campaign money from deep-pocketed donors. The event also drew protestors to the wealthy enclave of Hunt’s Point, Wash., but they probably didn’t get too far. Not only do most billionaires’ homes have lots of bedrooms and terrific views, they tend to come with the best security.